KEY POINTS:
The sharemarket this morning picked up from strong afternoon trading yesterday after Wall Street rose sharply.
The three major US stock indexes rallied more than 2.5 per cent, powered by the best day in two decades for some major banks as unexpectedly strong results from Wells Fargo & Co relieved worry about a credit crisis spiralling out of control.
A US$4 ($5.25) drop in oil prices gave more fuel to the rally, offsetting an early report that showed US consumer prices in June rose by the most since the aftermath of Hurricane Katrina in September 2005.
Here, the benchmark NZSX-50 index was up 1.4 per cent, 42 points, in the first quarter of an hour, to 3095. Around noon yesterday the index touched a new three-year low of 3001.
No 2 stock, Contact Energy, which yesterday jumped 26c, was today up 10c to 750.
Top stock Telecom was up 5c to 343 to add to yesterday's 7c gain.
Fletcher Building, which was tipped in the New Zealand Herald today as a possible takeover target because it has fallen so far, leapt 31c to 635.
Analysts said they expect the construction company to downgrade profits for 2009 and 2010 but they still said it was undervalued.
Rakon, which announced it had formed a joint venture in China with Timemaker, in which it had also bought a 40 per cent stake, rose 9c to 269.
NZ Oil & Gas was down 3c to 168 in response to weakening oil prices.
Sky City was up 6c to 304 while Sky TV was up 8c to 423.
Bank stocks responded to the rally in that sector in the US, with Westpac up 55c to 2500.
Air NZ rose 2c to 112 as a result of falling oil prices.
The Warehouse was up 9c to 399.
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In the US, the Dow Jones industrial average jumped 276.74 points, or 2.52 per cent, to 11,239.28, while the Standard & Poor's 500 Index gained 30.45 points, or 2.51 per cent, to 1245.36. The Nasdaq Composite Index shot up 69.14 points, or 3.12 per cent, to 2,284.85.
The three indexes had their largest single-day percentage gain since April 1.
- NZPA
